Vermont Business Magazine In order to afford a modest, two-bedroom apartment at the Fair Market Rent in Vermont, renters need to earn $21.90 an hour, or $45,545. This is Vermont’s 2017 Housing Wage, revealed in the annual Out of Reach report released today by the National Low Income Housing Coalition, a Washington, DC-based research and advocacy organization, and the Vermont Affordable Housing Coalition. At Vermont’s current minimum wage, individuals would need to work 88 hours per week, or 2.2 full-time jobs, to afford a two-bedroom rental home.
Vermont has the 5th largest affordability gap for renters of any state in the nation. Vermont has nearly 75,000 renter households. Kentucky is the most affordable ($13.95/hour or 77 h/w) and Hawaii is least ($35.20 or 152 h/w). Overall, Vermont is the 13th highest rental market. It ranks 20th for median household income ($56,990).
The Housing Wage is the hourly wage a family must earn, working 40 hours a week, 52 weeks a year, to be able to afford the rent and utilities for a safe and modest home in the private housing market (affordable means paying no more than 30% of income). Every year, Out of Reach reports on the Housing Wage for all states, counties, and metropolitan areas in the country.
The report highlights the gap between what renters earn and what it costs to afford rent at fair market value. With an estimated mean renter wage of $12.51 an hour, average Vermont renters are left $9.39 an hour short of what they need to earn to afford a decent place to live. They can afford just $650 a month for their housing costs while the average statewide Fair Market Rent for a two-bedroom apartment is $1,139. Vermont has the 5th largest affordability gap for renters of any state in the nation. Vermont has nearly 75,000 renter households.
Senator Patrick Leahy (D-VT), Vice Chairman of the Senate Appropriations Committee, said: “With 27 percent of Vermonters living in liquid asset poverty, I often hear from Vermonters who are struggling just to make ends meet. I am proud that Vermont’s affordable housing leaders are some of the best in the nation. For years they have built a system to help ensure that families do not fall through the cracks. While Vermont continues to make strides since the Great Recession, resources like the NLIHC Out of Reach Report remain key tools to ensure that policymakers, service providers and community partners have the information they need to help every family succeed.”
Even though Vermont’s minimum wage has increased annually for the last several years, it is not enough to pay for decent housing: 2.2 full-time jobs at minimum wage – or 88 work hours a week – are needed to afford the average two-bedroom apartment. A full-time minimum wage worker in Vermont can only afford $520 a month for rent and utilities, leaving a gap of $619. While some might consider this is an unfair comparison because they think most minimum wage workers are high school students, this is not the reality. According to the latest data from the Bureau of Labor Statistics, the average age of a minimum wage worker is 35 years old, and 88% are at least 20 years old. Half are older than 30, and about a third are at least 40.
“It is no secret that – because of an economy that is rigged for the benefit of the very rich – wages for most working families have been stagnant for several decades,” said Senator Bernie Sanders (I-VT), Ranking Member of the Senate Budget Committee. “Millions of Americans are struggling to get by, working longer hours at lower wages, while the cost of housing keeps going up. Here in Vermont, far too many households pay more than 50 percent of their limited incomes to keep a roof over their heads, leaving little for other necessities like food, clothing, heat and medicine. As a country, we must reorder our national priorities, and that includes investing more in decent and permanently affordable housing for working families."
Unfortunately, federal funding levels for housing, rental assistance and supportive services are far below what they were five or six years ago. Key federal programs like HOME, Section 8 Vouchers, and Community Development Block Grants have been underfunded for years, and are now under serious threat in the Trump Administration’s recent budget proposal.
“Today’s report shows how far we still have to go to put affordable housing in reach for all of Vermont’s families,” said Congressman Peter Welch (D-VT). “The numbers make it very clear that the President’s budget proposal to drastically slash funding for affordable housing programs and services is a step in the wrong direction. This is an area that is in need of significantly more resources for the most vulnerable Vermonters, not less."
The state of Vermont suffers from chronic budget shortfalls and has been unable to make the necessary increases to such key housing safety net programs as the Vermont Rental Subsidy Program, which helps close the affordability gap for low-income Vermonters. The $35 million housing bond included in the FY 18 State budget to help fund the Vermont Housing and Conservation Board is certainly an essential step in the right direction towards providing more affordable housing for Vermonters. The Coalition hopes that the current impasse between the Governor and lawmakers can be resolved soon so that critical new housing can be built.
Additional findings from Out of Reach:
- The national Housing Wage is $21.21 in 2017.
- Vermont is the seventh most expensive state for rural (non-metro) areas.
- Vermont is the 13th most expensive state in the nation for renters.
- The Housing Wage in the greater metropolitan area of Burlington is $26.83, almost $5.00 an hour higher than the state average.
- Someone with a disability living on Supplemental Security Income (SSI) can only afford $236 a month, leaving them $903 short for a two-bedroom, and $665 short for a one-bedroom apartment.
The Vermont Affordable Housing Coalition is a statewide membership organization dedicated to ensuring that all Vermonters have decent, safe and affordable housing, particularly the state’s low and moderate-income residents, elders, people living with homelessness, and people with disabilities. www.vtaffordablehousing.org.
The National Low Income Housing Coalition is dedicated solely to achieving socially just public policy that assures people with the lowest incomes in the United States have affordable and decent homes. www.nlihc.org.
Source: BURLINGTON, VT – Vermont Affordable Housing Coalition 6.8.2017